Waukegan delays vote on proposed property-tax levy increase

Waukegan Mayor Sam Cunningham asks the aldermen April 9, 2018 if they have any questions following a presentation by Finance Director Tina Smigielski about the proposed 2018-19 budget.

Waukegan Mayor Sam Cunningham asks the aldermen April 9, 2018 if they have any questions following a presentation by Finance Director Tina Smigielski about the proposed 2018-19 budget. (Emily K. Coleman/News-Sun)

A scheduled City Council vote that would increase the amount the city of Waukegan collects in property taxes by 9.26 percent was postponed Monday evening.

Mayor Sam Cunningham said the aldermen needed more time to talk about it and had asked for more information from department heads.

The departments are in the process of outlining their goals and objectives for the coming year and determining what costs would be necessary to make those happen, Cunningham said.

“What I'm getting a sense (of) is everyone is not comfortable with not knowing why this number is there,” Cunningham said. “Running a city is not inexpensive, and we need to align what it takes to run the city versus what we're asking for.”

The City Council must pass a levy and have it filed with the Lake County Clerk by Dec. 21.

The proposed levy includes $25.25 million, an increase of 4.62 percent over last year, for the city's annual expenses like employee pensions, operations at the Waukegan Public Library, garbage collection and certain long-term equipment leases.

The city would also need to levy an additional $12.08 million to cover existing debt, according to an Oct. 9 memo to Cunningham and the council from Finance Director Tina Smigielski.

Cunningham has been pushing to get the property-tax levy high enough to cover 100 percent of the city's long-term obligations.

“I think everyone just assumed that (the amount levied in the past) was what it was going to take to run the city,” Cunningham said. “Unfortunately, it does not.”

While state law requires the city to levy a set minimum for its police and fire pensions, no such mandate exists for other retirement obligations.

Two years ago, the city levied enough to cover about 32 percent of the $2 million it needed to contribute to the pension fund for non-sworn personnel, down from covering 53 percent the year before, according to numbers provided by Smigielski.

Last year, Cunningham proposed increasing the levy to cover that projected $2.2 million cost completely. Instead, the council approved an increase to $1.75 million, or about 85 percent of the cost, according to city and county tax records.

The city covered the difference using other revenue streams, which contributed to this year's budget deficit, according to Smigielski's memo.

The City Council approved a $125 million budget with a $2 million operating deficit in April followed by a series of new debt obligations to fund a wide array of infrastructure improvements, including to the water plant, its roads, parking lots and facilities.

One of those bonds will be paid back using property taxes, while the other two are covered by sales tax and water rate increases.

The city's obligations — including the new debt, the deficit budget and a new police union contract with mandated raises — were approved in near unanimous votes, said Ald. Lisa May, who voted against many of those measures over concerns about how they would be paid for.

“You also have to have the courage to raise the tax levy to cover those expenses that you approved earlier in the year,” May said at an October meeting.